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William Cowie  

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  • BlackBerry: Are We Turning A Corner? [View article]
    I was a Blackberry user until a month ago. I finally went with an iPhone, primarily for the ecosystem. As a phone, my old BB Bold runs rings around the Apple. But in the new world, it's not just about the phone any more, is it? Blackberry owned the market, and Apple took it away with an innovation that created this powerful ecosystem. Google offered a competing ecosystem with Android, for those who don't like or can't afford Apple.

    Unless Blackberry can think of something the Apple/Android world doesn't have, or carve out a niche that doesn't care about the Droid/iOS ecosystems, they will go the way of the Palm Pilot. Slowly, probably, but inevitably.

    Sad. I really, really like my old Blackberry...
    Dec 5, 2014. 07:05 PM | 5 Likes Like |Link to Comment
  • The Oil Stock Crash Is A Major Buying Opportunity [View article]
    Question for you: you didn't address the fact that both WG and MDR are losing money. Why is a backlog good when you can't make money on those revenues? Thanks for the article.
    Dec 3, 2014. 12:01 PM | Likes Like |Link to Comment
  • The Fed's Ice Bucket Challenge [View article]
    About "...equity valuations have become far removed from the underlying anemic fundamentals of the economy..."

    Are you saying a market PE of under 20 is "far removed?"

    Sep 4, 2014. 11:38 AM | 1 Like Like |Link to Comment
  • Piketty's Envy Problem [View article]
    Thomas Piketty's research goes back a bit. He and Emmanuel Saez of Berkeley captured the concept of inequality back in 2003, when they used some hard data to quantify what others had just talked about.

    They recently updated their research, and I wrote about it ( to a different audience, admittedly with a different slant.

    Their update struck a nerve and generated a lot of interest. It seems to me Prof. Piketty wanted to follow up on the good work quantifying the data, hence the book. It was a bit of a disappointment to me, too, for much the same reasons as you articulated.

    There is one difference, though: the post linked to above (which used their data directly) clearly shows how inequality shrank in the years after WW2, but rose again after the "trickle down" tax changes of the mid-eighties.

    That alone makes it hard to argue against the impact of tax regression, up or down.
    Sep 1, 2014. 10:33 AM | 10 Likes Like |Link to Comment
  • Earnings: A Better Indicator For A Stock Market Peak? [View article]
    This article wasn't meant to discredit the CAPE, or to call it "useless;" it was merely to point out that IF your goal was to use it to call a top, there is something that could be better. (I specifically noted it's the media who spun Prof. Shiller's comment, but that he didn't correct them. Each draws their own conclusions.)
    Sep 1, 2014. 10:10 AM | Likes Like |Link to Comment
  • Earnings: A Better Indicator For A Stock Market Peak? [View article]
    Yep, it is imperfect, no question about it. It is but one step in the quest for a better and better warning sign. Any and all improvements welcome...
    Aug 31, 2014. 06:31 PM | Likes Like |Link to Comment
  • Earnings: A Better Indicator For A Stock Market Peak? [View article]
    Agreed, but... what is "low" and what is "high?"
    Aug 31, 2014. 06:29 PM | Likes Like |Link to Comment
  • Earnings: A Better Indicator For A Stock Market Peak? [View article]
    If you're looking for perfection, you're right. But think about it: there is nothing that predicts the future, any future, with 100% accuracy.

    The only question is: is earnings a better warning sign than either measure of PE? That's all. You judge if it's better or not.
    Aug 31, 2014. 06:28 PM | Likes Like |Link to Comment
  • Earnings: A Better Indicator For A Stock Market Peak? [View article]
    The reason the pe10 has attracted attention is because its creator, Prof. Shiller, has been quoted as saying that the market is "pricey" because of its current level (over 20). That quote has been spun by many commentators as him saying the market is overvalued and ready for a drop, and he hasn't disclaimed it.

    It's an entirely different topic to ask whether a multiple of the past 10 years' earnings is a good estimator for future performance...
    Aug 31, 2014. 06:26 PM | Likes Like |Link to Comment
  • Secular Bull And Bear Markets [View article]
    Great insight, thanks for sharing. Two comments: in a related article on your web site you note that dividends are excluded, and that the rate at which dividends are returned to stockholders has declined in the past few decades. That change, if true, would indicate that the regression line overstates the early growth in stock prices, and understates it in recent times.

    Shouldn't dividends be included in the presentation of market returns? After all, it is a somewhat arbitrary divvying up of the return, isn't it? Executive compensation these days seem to be more focused on the stock price than the total return (stock price + dividends). Stock options don't pay dividends.
    May 1, 2013. 09:09 AM | 2 Likes Like |Link to Comment
  • Bail-Out Is Out, Bail-In Is In: Time For Some Publicly Owned Banks [View article]
    And in this environment gold is going down, not up...

    Maybe it's whistling past the graveyard, but the Cyprus situation has some unique features, the main one of which is the the big banks in question there seem primarily to have served foreigners who benefited from shall we say lax controls. It is telling that part of the EU "rescue" was that those banks now have to follow the same money laundering rules as the rest of the civilized world. All's to say the depositors whose money was allowed to float into the sea might very well have been the kind whose money was not unused to water...

    Which all means we can whistle past the graveyard some more, believing something that bad might not happen here. After all, how much worse can it be than the 2008 mess?
    Apr 29, 2013. 10:51 PM | 2 Likes Like |Link to Comment
  • Yes, tax rates may rise next year, but that may not be as damaging to share prices as some think, WSJ's Jonathan Burton writes. Dividend-paying stocks historically have outperformed their yieldless peers even when taxes were higher, and with few other sources of yield in today's low-rate investment environment, where else can you go? [View news story]
    To answer whether or not the tax increase may affect stock prices, you need to look at how. And the answer to that lies in redemption requests. If you recall, the big drop in 2008 came from the cumulative effect of dropping prices prompting hedge fund margin calls, which prompted more sales, which prompted mutual fund redemptions, more margin calls and hedge fund redemption/liquidation requests. It was the mass mutual fund redemptions (as 401k holder shifted to money market funds and money managers tried to flee the tsunami) and hedge fund redemptions that caused the price drop.

    In other words, the drop was caused by a :run on the funds," the modern day equivalent of a run on the banks.

    In such a market, it doesn't matter if a stock pays dividends. Last year's summer sell-off was similar. It was the specter of a U.S. debt downgrade that gave the market "the runs" then.

    In both those cases, did the fundamentals matter, dividend or otherwise? No. By that logic, dividend stock would have stood alone against the dropping tide last summer. They didn't.

    So the question is: will a tax increase give the market another case of the runs? Unless it does, it won't affect the market.

    As to the last question: in a run, where else can you go? Cash and gold.
    Sep 4, 2012. 06:26 PM | 2 Likes Like |Link to Comment
  • Earnings Season Can't Fix The Global Economy; Downside Risk Growing [View article]
    Earlier this week we moved to over 75% cash, so of course we like anybody who agrees with us LOL

    Seriously, though - great article! Pulling together so many data points and creating a clear picture (of a murky situation) isn't easy, and I think you succeeded admirably.
    Jul 26, 2012. 03:00 PM | Likes Like |Link to Comment
  • Individual Investors Laughing All The Way To The Bank [View article]
    Did anyone notice that the fall in sentiment happened the same time each year, and that the "sell in May" drop came soon after the drop last year? Could it be that the drop in sentiment simply is the AAII guys anticipating May? (see the AAII guy's breakdown elsewhere)

    Interesting premise, but it probably needs a little more in the way of support.
    May 12, 2012. 06:08 PM | Likes Like |Link to Comment
  • WSJ Gets It Wrong on Unemployment Insurance [View article]
    It's easy for those with jobs to pontificate. Do they know how hard it is to simply get an interview, much less a job?

    Choppable? More than that, the WSJ article is chopped liver. Where's the evidence? Have they actually done a scientific study of whether or not frustrated job seekers are lazy bums, or is this just the after lunch residual buzz talking?
    Dec 10, 2010. 02:15 PM | 5 Likes Like |Link to Comment